Farmers are facing mounting challenges

The American Sugar Alliance recently posted an article citing a Bloomberg report that said just four years after record U.S. crop and farmland values boosted the purchase of land and equipment, a global surplus has sent prices tumbling and pushed farm income into the longest slump since 1977.

Betting the farm on record crop, livestock and dairy prices has turned into a losing investment for an expanding share of America’s agricultural heartland, the report said. The level of debt to income is the highest in three decades and growers are increasingly unable to make loan payments.

The Federal Reserve says growers are borrowing more to pay bills, repayment rates are plunging and the number of bankers requesting additional collateral is the highest in 25 years.

Bloomberg also reported that while low interest rates and savings have kept farmers in better financial shape than the bankruptcy crisis of the mid-1980s, signs of stress are increasing, especially for growers who invested during the boom years.

Farm income is down 42 percent from a record in 2013, government data show, and MetLife Agricultural Finance predicts farmland values will tumble 20 percent by 2018.


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